In a speech delivered at Georgetown University this afternoon,
Obama outlined his approach for addressing climate change. His
action plan decreases carbon pollution, prepares the U.S. for
increasingly severe weather patterns and spearheads an
international effort to combat climate change. Many of his
proposals are executive orders, circumventing the need for
Congressional approval.

Obama is directing the U.S. Environmental Protection Agency to
work with existing and new power plants to develop emission
standards, according to a blueprint for the proposals from the
White House. Obama is working to meet a commitment he made in
2009 to reduce U.S. greenhouse gas emissions by 17 percent
between 2005 and 2020.

Requiring the reduction of carbon emissions will make coal-based
energy more costly, while solar and wind technology are expected
to be priced more competitively, thereby supporting those
alternative
energy industries, says Jason Blumberg, chief executive and
managing director of Energy Foundry, a Chicago-based cleantech
impact venture capital fund. “Something like this will
increase the pie,” Blumberg says. Not only will the initiative
support existing startups that are trying to get off the
ground, but “it also provides opportunities for new
technologies that are currently in the lab to come to market.”

For example, 50 percent of the heat that escapes coal plants is
wasted heat, Blumberg says. As power plants are charged with
decreasing their emissions it becomes more profitable for an
entrepreneur to innovate a way to turn that wasted heat into
useable energy, he says.

Not only will the initiative support new startups, but it will
work to promote cleantech innovations that already exist but
aren’t widely adopted yet, according to Greg Neichin, the
executive vice president of San Francisco-based Cleantech Group, an industry research and
advisory group. “Anything that is encouraging deployment of
new technologies is ultimately a good thing for entrepreneurs
in the space,” says Neichin.

Approximately $50 billion in venture capital has been invested in
the cleantech industry in the past decade, says Neichin, but
widespread adoption of the new technologies has been slow. “It is
not for lack of innovation that things are not progressing," he
says. "The speed of deployment is often slow.”

In the next few weeks, the Department of Energy will issue a
draft of a plan for $8 billion in loan guarantees for alternative
energy projects, according to the White House blueprint. The
finalized plan will be released in the fall. This capital will be
used to back investments in equipment and construction necessary
for installation of alternative energy solutions, including
everything from construction efficiency to water conservation.
“In general, many of these have long payback periods, so loan
guarantees over the life of those projects are quite helpful in
getting customers over the hump of taking the risk on new
technology,” says Neichin.

Obama’s climate-change initiative charges the U.S. Department of
the Interior, which protects America's natural resources, with
permitting enough renewable energy -- in the form of solar
panels, wind farms and geothermal plants -- to power millions of
homes. Creating a pool of opportunities creates revenues,
customers and the technologies to become more efficient and offer
people the opportunity to try new technologies, says Blumberg.

In addition to cutting carbon pollution in the U.S., Obama also
emphasized the need to prepare the infrastructure for the
repercussions of climate change, including hotter days and more
severe weather patterns. Hurricane Sandy, when it slammed the
East Coast last year, was devastating to countless small
businesses. The Obama Administration is making climate-relevant
government data public in what’s being dubbed the Climate Data
Initiative. A goal is to provide entrepreneurs materials they can
use to innovate ways the U.S. can be more prepared for climate
change.

While higher coal-energy prices are expected to drive innovation
in the cleantech sector, many small businesses and consumers will
likely be hurt by the higher energy bills in the short term, says
Blumberg. While it is still uncertain just how much coal-energy
prices are expected to rise, Rep. House Majority Leader Eric
Cantor has called Obama’s initiative a “war on coal,” which he
says will cost jobs and hurt businesses.